Houghton Mifflin Harcourt Completes Acquisition of Scholastic’s Educational Technology and Services Business for $575 Million

BOSTON – Global learning company Houghton Mifflin Harcourt (NASDAQ: HMHC) (HMH) announced today that it has completed its previously-announced acquisition of the Educational Technology and Services (“EdTech”) business of Scholastic Corporation for $575 million in cash, subject to customary working capital adjustments.

With this transaction, HMH adds market-leading intervention curriculum and services to its industry-leading Pre-K-12 portfolio. The addition of the EdTech group also builds on HMH’s strategy to expand in other key growth areas, including educational technology, early learning, and education services.

“The closing of this acquisition is an exciting milestone for HMH, the EdTech business, and the broader education community,” stated Linda K. Zecher, HMH’s President and Chief Executive Officer. “Our combined content portfolio, sales and services capabilities, and robust digital platforms yield a comprehensive offering that will better serve teachers, students, parents and lifelong learners. We look forward to working with this talented team to further drive our vision of fueling a learning transformation powered by technology.”

Eric Shuman, HMH’s Chief Financial Officer, commented, “We’re excited to have completed this transaction, which deepens our strategic positioning in key growth areas. We believe that the new revenue streams and cost synergies we expect to realize from this transaction will enhance our overall financial profile. We will continue to take a prudent approach to capital allocation as we look to drive long-term growth and stockholder value.”

With the close of this transaction, the EdTech group’s approximate 800 employees have become part of HMH, including the division’s President Margery Mayer, who joins the Company as EVP, HMH Intervention Solutions, reporting directly to CEO Linda Zecher.

“The entire EdTech team is delighted to join an organization that brings both passion and innovation to learning,” added Margery Mayer, EVP, HMH Intervention Solutions. “As part of HMH, we gain a unique opportunity to serve a broader customer base and to develop new, cutting-edge products and services designed to close achievement gaps and accelerate the learning transformation.”

HMH also closed today on the $800 million senior secured term loan facility with a six-year maturity, which replaces its existing $180 million term loan.

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About Houghton Mifflin Harcourt
Houghton Mifflin Harcourt (NASDAQ:HMHC) is a global learning company dedicated to changing people’s lives by fostering passionate, curious learners. As a leading provider of pre-K–12 education content, services, and cutting-edge technology solutions across a variety of media, HMH enables learning in a changing landscape. HMH is uniquely positioned to create engaging and effective educational content and experiences from early childhood to beyond the classroom. HMH serves more than 50 million students in over 150 countries worldwide, while its award-winning children's books, novels, non-fiction, and reference titles are enjoyed by readers throughout the world. For more information, visit www.hmhco.com.

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